Transcript of a Press Briefing by Masood Ahmed

MR. AHMED: Good morning. Happy New Year. Welcome back to our first press briefing for 2007. I am Masood Ahmed.

After a couple of relatively quiet weeks, we have got a busy period ahead of us, and what I thought I might usefully do is just lay out a little bit of the program for this month, particularly in terms of management travel.

Let me start by saying that the Managing Director is starting the new year with a trip next week to Gabon and Cameroon. In Gabon, he is going to be inaugurating the third African Technical Assistance Center, the Regional Technical Assistance Center, and in both Gabon and Cameroon, he will have an opportunity to discuss the implementation of the Medium-Term Strategy. This is, in fact, his sixth trip to Africa since he took over in 2004.

Later in the month in the week of the 22nd, he is going to be traveling to Asia, and again that will be an opportunity to talk to both officials and other interested parties about the Medium-Term Strategy. Again, we have a press release on the African trip which I believe you should have now which we can release today, and we will have more details on the Asia trip in the coming week.

In between the two trips, on the 16th, there is going to be a press conference which the Managing Director will hold and which will be an opportunity for him to take questions from people both in the room and around the world on the program ahead, and it will also be a chance for him to give you an update on the agenda for the Fund for this year. So instead of the standard EXR press conference two weeks from now, we will have the Managing Director doing his press conference here on the 16th. I guess the time for that has been set for in the morning. I think it is 10:00, but we will confirm the time. It is certainly in the morning and probably 10:00.

On the 17th, he is going to be giving a speech at Georgetown University which is the day after the press conference, and again we will give you more information and the text on that speech as it becomes available.

Let me just say also that John Lipsky, the First Deputy Managing Director, will also be traveling this month to India and then to Switzerland where he will be at the World Economic Forum in Davos. Media Relations will have more details about his availability during those visits.

Finally, let me conclude by saying that this is the last week here in the IMF for Francisco Baker who has been our lead press officer for Latin America and who has had a long and varied career before that. So I just want to take this opportunity to thank him for the work he has done at the IMF and to wish him well in the next phase of his life.

So those are by way of introductions. I am happy to take any questions that people have and do please identify yourself.

QUESTIONER: Hi, Happy New Year. You mentioned the Managing Director's Asian trip this month. So I would like to know what countries is he going to visit specifically.

MR. AHMED: On the Asian trip, he will be visiting Japan and then China and Indonesia. That is the current planning, but, as I said, we will have more on that in the next week or so.

QUESTIONER: You said his trip to Gabon and Cameroon was regarding the Medium-Term Strategy. There is discussion, I believe, or there is a paper before the Board regarding the basic votes. Does that have anything to do with it?

MR. AHMED: Well, I will say in Gabon he is going to have, first of all, the opportunity to be there for the inauguration of the AFRITAC. I want to stress the fact that particularly in Africa, this is now the third AFRITAC that we are going to be setting up with a lot of help from not just the participating countries but also a number of donors who are helping to finance it. It just demonstrates, in fact, that in many of these countries, the Fund's role is as much capacity-building support as it is financing, and that is something to emphasize.

Beyond that, in Gabon and in Cameroon, he will also have an opportunity, as I said, to talk about the implementation of the Medium-Term Strategy. In Gabon, there is a group of officials, ministers, and heads of state from a number of countries who will be there. He will want to talk to them about a broad range of Medium-Term Strategy issues including the reform of surveillance on which the Board this month is having more discussions about whether and how to take forward the review of the 1977 decision.

On the quotas and voice discussion, as you say, there are two parts to it, and obviously he is going to talk about them both about what is happening on the next steps in terms of the formula for quotas on which there was a discussion in the Board in December but also what is happening on the amendment on the basic votes on which there is going to be a first discussion in the Board again during the month of January, and on what can be done to strengthen the offices of EDs that represent many countries of which Africa is the case where they have the most countries. Again, on that, there is going to be a preliminary discussion this month. So those two items are being taken forward on a short timeframe, and that will be an opportunity for him to brief them and then get advice from them on how they see that agenda moving forward.

QUESTIONER: Can I have a follow-up on that, please? Is the idea to strengthen the EDs' offices or the Africa Department as well, the IMF Africa Department?

MR. AHMED: No. The discussion that came out from Singapore, the resolution, is about strengthening the capacity of EDs' offices. So the focus now is on strengthening EDs' offices that represent many countries, and there are different ways in which you can do that, and that is what the Board will be discussing. As I say, in parallel, they are also discussing what can be done in terms of taking forward the strengthening, the doubling of basic votes which will require, as I have mentioned before, an amendment of the article. So both of those items are on the Board's agenda for this month, and that will be a chance for the MD to talk to governors about that.

QUESTIONER: Early estimates suggest that Mr. Rajan's successor would have been named by now and there would be a little more progress made. Should we take this that you guys are having trouble finding a replacement for him or what is the reason for a delay in somebody being named?

MR. AHMED: The reason for the time that we are taking is that we are going through a process of identifying the right person. We think it is important in this particular job, as in all senior jobs in the Fund, to find the right person for the job. We haven't gotten to the point yet where we are ready to say who that person is, and as soon as we are we will come back to you.

I have one question here from the Media Briefing Center which let me try and answer that. There is a question on Nicaragua, and the question is as follows:

Anoop Singh has led an IMF mission to Nicaragua last month. Some sources said that incoming President Daniel Ortega was reluctant to subscribe to Singh's suggestions on structural reforms. What has Ortega told the mission and has the IMF scheduled a new visit down to Nicaragua? That is the question that I have just got.

I think, the best place to find an answer to your question is actually to look at the press release at the end of Anoop Singh's visit on December the 20th. I don't know whether you have a copy of it, but if you look at it-and it is on our web site-I think what you will find there is a press statement. Let me read to you a couple of sentences from it.

It says-this is Anoop reporting on his visit-President-elect Ortega has emphasized to me his commitment to prudent macroeconomic policies and intensifying poverty reduction. In particular, the President-elect expressed his intention to work with the Fund toward an early new economic program that would entrench stability in Nicaragua and move ahead with reforms, critical for raising investment and sustainable growth and accelerating employment creation and poverty reduction. We at the IMF look forward to working closely with the incoming authorities to support their objectives.

So that is what we put out, and that is how we see the situation in terms of taking the work forward. I can also say to you that we do expect to initiate discussions in the coming weeks on a successive program to the PRGF that concluded in December, and we look forward to continuing to work on that. That is our response to that question.

QUESTIONER: I am going to stay in that vicinity. Talking about Ecuador, is there a mission planned for Ecuador? There is continuing nervousness in the market regarding statements by the new government on debt restructuring. What would the IMF's role be in that debt restructuring?

MR. AHMED: Let me look and see whether there is a mission planned on it. I don't see a specific date for a mission being planned. There may well be one, but I don't see one in the briefing that I have.

Insofar as the discussions on debt restructuring and the market, we have been following what has been in the market as well, but we haven't yet had any official discussions on what the nature or the plans of the government are and we look forward to those discussions. But until we have had a better understanding of what the nature of the plans are, it is difficult for us to take a view on both the plans themselves and what the IMF's role in that might be.

QUESTIONER: So, Masood, there wouldn't be almost a natural role for the IMF to play in such a debt restructuring? All that I can remember was Argentina, but that was a different case. There isn't a natural role that the Fund would undertake?

MR. AHMED: It is kind of hard for me to take a view on what the role of the Fund would be until we get a sense of what the nature of the program is. So I think we look forward to and expect to have a discussion on a broad-ranging economic program within that. No doubt that will be an issue. But as to how and what role we might play in whatever program the government adopts is something that is further down the road.

QUESTIONER: To default to something earlier, what is the subject of the Managing Director's speech at Georgetown later this month?

MR. AHMED: We expect that the speech will focus mainly on European economic issues, but he will take that opportunity, I am sure, also to give a little bit of an overview on how he sees the implementation of the Fund's reform agenda.

If there are no further questions, thank you all very much. In two weeks time, we will have the Managing Director giving an overview.